list of folks at conference in Thailand on June 12,13
FOUND ON RAGING BULL BOARD, GOOD STUFF, WE HAVE BEEN WANTING TO KNOW THIS STUFF. THANKS WHOEVER GOT THIS....
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Biofuels Markets Asia
Orchard Hotel, Singapore
June 12th – 13th 2007
Part of the Market Leading Sustainable Energy Week Asia
Energy demand in Asia is expected to more than double by 2030, from almost
500m tonnes of oil equivalent in 2002. Leaders from 16 Asian countries,
representing half of the world’s population, pledged on January 15 to develop
alternative energy supplies such as biofuels and reduce harmful greenhouse gas
emissions through a voluntary ASEAN pact. Southeast Asian nations are also
seeking Japan’s help in gaining access to the growing global carbon emissions
trading market, valued at around $10 bln.
2006 was a roller-coaster year for the global Biofuels industry, especially in the
area of feedstock prices. Geopolitical factors such as oil prices, unrest in major
oil supply countries such as Iran, Iraq, Nigeria and Venezuela, concerns over
energy security and the growing evidence of global warming all impacted the
market.
Both the IEA & OPEC predict that oil prices will remain in the $60-$70 price
range, which is sufficient to make Biofuels competitive.
Ethanol demand in Asia is mainly being driven by the high economic growth rates
in India and China and is expected to grow between 7-8% a year. Asia’s total
demand for fuel ethanol is projected at around 2bn litres in the year to September
07; however delays in Thailand’s market may impact this.
With the passing of the Philippines Biofuels Act in December 2006, all gasoline
products in that country should have an ethanol content of at least 5% within two
years. All diesel vehicles should use a minimum 1% biodiesel blend within three
months of the law’s effectivity. Coconut oil is being used as the main feedstock
to achieve this. The mandated blend will rise to 2% for biodiesel after two years,
and to at least 10% for bioethanol after four years.
According to the Philippines Fuel Ethanol Alliance, the bill will generate a
guaranteed annual demand of between 200m and 400m litres of ethanol. To
meet this expected ethanol demand, the group says that at least 14 ethanol
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production facilities with capacities of at least 100,000 litres a day need to be
established.
In China, the biofuels industry continues it upwards expansion, with five large
ethanol plants now operating, although higher prices for maize and soy are now
acting as deterrents for some entrants. Chinese ethanol production reached
1.02m tonnes in 2005, much of which was exported to the US, although that is no
longer the case. In contrast to India maize accounted for most of the raw
material, with wheat and sorghum providing the rest. China aims to use 6.7m
tonnes of ethanol and 11m tonnes of biodiesel by 2010, meeting 10% of its
forecast transport fuel demand, a government economist has said. The country’s
emphasis will be to develop ethanol from cassava, sweet potato and maize, and
biodiesel from animal and vegetable waste oil, said Wang Zhongying, Director,
Centre for Renewable Energy Development at the policy-setting National
Development and Reform Commission (NDRC). The country has plans to
reserve 44m hectares of land for biofuel feedstock growing. Longer term, China
will look to develop diesel from wild crops such as jatropha and cellulose ethanol
agricultural and forest waste, as it forecasts 9m tonnes of ethanol use and 15m
tonnes of biodiesel by 2020. The government has also introduced new fiscal
grants and tax allowances to the biodiesel industry.
Malaysia was expected to produce 140,000 tonnes of biodiesel in 2006 and that
output could more than double to 300,000 tonnes by December 2007 according
to Plantation Industries and Commodities Minister Datuk Peter Chin Fah Kui.
Malaysia’s biodiesel industry may not expand as fast as initially hoped because
of feedstock prices. Only large plants with secured raw materials will survive,
with some small and stand alone producers falling by the wayside.
M.R. Chandran, Independent Industry Analyst & Former Head, Malaysian Palm
Oil Association
Opening Plenary – Sustainable Energy in Asia
This opening plenary with be shared with the delegates of the co-located
Renewable Energy Finance Asia conference. The session speakers will include
representatives of the Government of Singapore and other leading figures from
the region.
Regulation & Policy – Creating Competitive Biofuels Markets
o New government policies and support
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One of the main issues the industry is facing now is the regulation (or lack
thereof) of biofuels and their taxation, the area needs an ASEAN based policy to
promote the use of biofuels and the taxation incentives which have been applied
in certain European countries. Without the right legal framework biofuels will
face a hard time in view of lower oil prices.
ASEAN
Singapore/Malaysian Government Representative
Thailand
The Thai Energy Ministry, ethanol producers and fuel retailers have agreed on a
pricing formula for ethanol. The ethanol price has been declining sharply due to
the postponement of the January 1st deadline to stop sales of octane-95
gasoline. Plans in place by mid 2007 to further promote 10% ethanol products.
Thailand was struggling to produce the required amount of ethanol it needs.
The ministry is considering adjusting the price of B100 biodiesel in order to reflect
the prices of raw palm oil, ethanol and production costs. Thailand currently uses
its state oil fund to help lower prices to encourage motorists to switch.
Investors in Thailand’s ethanol industry now are worried about a potential ethanol
oversupply because the government has not clarified its revised policy and
deadline for phasing out gasoline containing MTBE in favour of gasohol.
Panich Pongpirodom, Director General, Alternative Energy Development &
Efficiency Department
Pornchai Pornchai Rujiprapha, Permanent Secretary, Energy Ministry
Piyasvasti Amaranand, Energy Minister
The government has scaled back several biodiesel programmes as it believes
the former regime was being overly optimistic. The use of B5 biodiesel, a mix of
95% diesel and 5% used vegetable oil, will be cut by half from the existing plan of
8.5m litres a day by 2011/12. As a result Thailand will aim to produce 4m litres of
biodiesel a day to substitute 7% of diesel consumption by 2011. The energy
ministry wants 300 service stations to provide 500,000 litres of biodiesel a day
this year. In addition Thailand’s agriculture ministry is revising a plan to promote
oil palm cultivation. Shifting focus to promoting biodiesel made from used
vegetable oil in local communities.
Viraphol Jirapraditkul, Director General, Energy Policy & Planning Office
The Thai Oil Fund will reduce the price of B-5 blends by raising the subsidy from
February. More oil retailers are being encouraged to sell biodiesel. At present,
biodiesel is being sold at 400 petrol station owned by Thai oil companies PTT
and Bangchak.
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Need to look closely at water recovery & reuse and also energy recovery &
reuse.
China
The Chinese government has suspended the approval of new ethanol projects
that use corn as a feedstock to limit the consumption of the grain. The move
followed a 15-20% rise in corn prices. Biofuels production should not happen at
the cost of food grains nor should it compete with grain crops for arable land.
The ministry is encouraging farmers to grow sorghum, cassava and other non
grain crops in areas that are unfit for grain production. However maize is still
favoured by many due to easier access to raw materials, low costs and mature
technologies. Corn currently contributes around 75% of the raw material for
making ethanol. China has set a goal of producing 6m tones of biofuels such as
ethanol by 2010 and 15m tones by 2020. Some processors dodge policy
restrictions by claiming to make beverage or industrial alcohol, which can be
conveniently turned into fuel ethanol once the government eases limits because
of the potential huge profits. The National Development and Reform
Commission, China’s top economic planner is tasked with review ethanol
projects.
Yang Jian, Director, Development and Planning Department, Ministry of
Agriculture
China plans to replace at least 25% of its refined oil requirements by 2020 with
renewable fuels.
Ms Shi Yangduan, Deputy Director, Science, Technology & Education, Ministry
of Agriculture
Xu Dingming, Vice Director, State Council’s State Energy Office
Singapore’s Noble Group is no longer looking for an ethanol partner in China due
to the license cuts for maize ethanol facilities. China is shifting its focus toward
ethanol from non food feedstocks such as tapioca. For Noble biodiesel is much
more realistic in China than ethanol.
Ricardo Leiman, Chief Operating Officer, Noble Group
Philippines
Philippines Biofuels Act signed into law, mandating the mixing of biofuels with
gasoline (ethanol and coconut methyl ester CME) to reduce the country’s
dependence on imported oil. Expected to save the country more than PHP35bln
worth of oil imports annually. Sponsors of the bill Senators Richard Gordon and
Aquilino Pimental Jr. The bill also establishes a National Biofuels Board (NBB)
which will oversee regulations and standards.
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China and the Philippines signed bilateral agreements on bioethanol production.
China, the world’s second largest maize producer and consumer, is expected to
become a net importer of maize, which is increasingly being used for domestic
ethanol production. The Philippines Department of Agriculture said it plans to
develop more than 300,000 ha of farmland for the cultivation of sugar cane and
coconut.
Arthur Yap, Agriculture Secretary
The Philippine Ethanol Alliance has appealed the Tariff Commission to lower
import taxes on Biofuels and eventually increase the duty once domestic ethanol
production has started.
Edgardo Abon, Chairman, Tariff Commission
Taiwan - The Environmental Protection Administration (EPA) has announced a
mandatory policy that starting from July each household will be required to
recycle their waste cooking oil that will go into the production of biodiesel. The
EPA and the Ministry of Economic Affairs are planning to replace all diesel fuel
for sale to consumers by biodiesel by July 2008. Since 2005, the EPA has
subsidized the trial use of biodiesel on 780 garbage trucks in thirteen counties
and cities. Reports of less black smoke being emitted, weaker truck engine
power and difficulty starting when the weather is cold.
India
Draft biofuels policy is in place in India, more inputs are being taken by India’s
policy think tank, the Planning Commission. India Oil Minister Murli Deora
recently said that the country’s oil refining and marketing companies plan to buy
550m litres of ethanol in 2007 for E-5 blends. According to the Indian newspaper
The Economic Times biodiesel production in India is currently not economically
possible after crude oil price falls. The price of feedstock including jatropha and
pongamia, esterification and processing costs are the reasons. Concerns from
chemical manufacturers which need ethanol for their products. Indian Chemical
Manufacturers Association says the new demand for ethanol has resulted in the
closure of many small and medium size chemical producers.
Indonesia
Event hosted by the Ministry of Energy and Mineral Resources to develop
biofuels. Government policy will likely be the most important factor in
determining whether the burgeoning biofuel industry in Indonesia will be a
success. National banks Bank Mandiri and BNI are providing some of the
financing. Plans for development would be concentrated in the eastern part of
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the country due to availability of land where raw materials can be produced.
There are currently only two companies who sell biodiesel from CPO to
Pertamina for mixing with local diesel, while a few others are producing biodiesel
on a small scale for their own use. Another two are producing ethanol. There are
however several areas for concern, the price of CPO, Jatropha is also being
considered but it could take several years to determine the variety of Jatropha
best suited to the various soil types, the right planting method, the right post
harvest handling and the right technology. Another concern is the by product of
biodiesel production, glycerin, with increased production will come oversupply of
glycerin and depressed prices.
Alhilal Hamdi, Head of Biofuel Development Committee
2 state owned companies, PT Rajawali Nusantra Indonesia and PT Perkebunan
Nusantra III are building ethanol plants using sugar cane and biodiesel plants
using palm oil.
Japan
The Japanese Ministry of Finance plans to convene a series of panels in
February to consider legislation to boost the use of biofuels in the country. A 3%
ethanol mix was introduced by the government in 2003, but so far there has been
little take up, mainly due to a lack of filling stations and infrastructure (this could
be increased to 10% if new legislation comes in). The panels will discuss tax
break and subsidies. Target of 10% of total petrol consumption in 2010. A new
bill could come into effect in 2008. The government could incentivise biofuel
production through tax breaks.
Interest in alternative fuels in the major oil importer has grown as crude prices
have risen, despite skepticism in the car manufacturing sector. Tokyo is planning
to put in place a regulatory scheme to advance the development of a biofuel
industry with the aim of cutting Japan’s dependence on foreign oil.
Petroleum Association of Japan
Australia
Australian motorists appear to be warming to the idea of using biofuels, latest
polls in NSW indicate, most support plans but many are still concerned about
engine damage.
Malaysia
Datu Dr. Michael Dosim Lunjew, Secretary General of the Ministry of Plantation
Industries and Commodities Malaysia
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Seizing the Biofuels Opportunity
o Large scale vs. small scale production
o Risks vs. rewards
Rural development – feedstock from the community utilized to produce biofuels
that are then used for running local machines i.e. tractors or generating electricity
for local usage or for sale into the local grid. Where farmers are purely feedstock
producers there is no guarantee that the local community will benefit. How do we
develop biofuels/bioenergy in developing countries so that farmers actually
participate and benefit from the development?
Ethanol is great replacement for oxygenate and octane (BTX) chemicals and it
creates a stronger agriculture base in developing regions. However, it is highly
dependant on the price of two unrelated commodities, crude oil and agriculture
crops. It is also not the entire solution but a piece of the puzzle, alongside a lot
of other solutions such as biodiesel etc.
Ethanol Life Cycle Assessment – analyzing the total energy inputs and the
effects on the environment of growing and harvesting the crops to the
manufacture, blending and combustion of ethanol to fuel.
Feedstock Strategies
o Availability and pricing
Fuel and food
Land use
Benefits and costs of biofuels developments on farmers
The Philippines Department of Agriculture plans to develop 740,000 acres of
farmland for cultivation of sugar cane and coconut. The Sugar Regulatory
Administration (SRA) which oversees the country’s sugar industry is seeking
farmland. The Philippine Coconut Authority is doing the same.
D1 Oils
See strong planting activity in India in 1Q 07, planting relationships are also
being consolidated for more extensive planting in South East Asia.
CGOG International Economic and Trading, a subsidiary of China National
Cereals, Oils and Foodstuffs is in negotiations with Thai exporters to purchase
100,000 tonnes of tapioca starch this year. Tapioca is in high demand for
ethanol production, other players such as the EU, South Korea and Malaysia are
also looking at this option.
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The main feedstock for bioethanol in India at present is molasses.
Malaysian plantation companies
Ahamad Mohamad, Managing Director, Kulim
Yong Chee Kong, Chief Operating Officer, Asiatic Development
Plantation giant IOI is talking about opening its first biodiesel plant overseas,
possibly in Europe, want to be near where the demand for biodiesel is highest.
Owns a refinery in Rotterdam that processes palm oil into speciality fats products
for the food and cosmetic industries.
Lee Yeow Chor, Group Executive Director, IOI Corp
Tan Sri Lee Shin Cheng, Group Executive Chairman, IOI Corp
Securing Feedstock for Biodiesel
Singapore’s CMS Resources
- Planning to acquire land and plantations in the coming months to secure
feedstock for its two biodiesel plants amid soaring palm oil prices
- Integration with upstream assets
- For business to be safe moving forward, you must own feedstock
- In talks in Indonesia to buy raw land as well as palm oil and sugar plantations
- Price fluctuations require such a strategy
- Current customers in Indonesia are textile mills, oil fired power generators
- Planning two other biodiesel plants in Singapore and Malaysia
David Finneren, Director, CMS Resources
Biofuels Sustainability
o Life cycle assessment
o The palm oil discussion
Global palm oil prices are expected to rise further by early 2007 as stockpiles
decline due to robust global demand ignited by the rapidly expanding biodiesel
industry. Concerns over sustainability and potential deforestation have led to a
publicity backlash from environmentalists and delayed plants in Indonesia and
Malaysia.
o What new feedstock options are there?
o Supply and demand
Southeast Asia’s severe air pollution caused by forest fires in Indonesia could
worsen in the coming year. The regions search for clean fuels will be largely
responsible as farmers and plantation group’s clear rainforests in Indonesia to
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produce palm oil for use in Biofuels. With palm oil prices high on the back of its
demand for biofuels this may continue for some time.
Ways of reducing energy consumption and becoming zero liquid discharge.
Plant Construction
o Scale
Patkol
Patkol, a Thailand listed engineering specialist is carving out a niche as a builder
of ethanol plants. Announced it had signed a contract to build a 1m litre per day
ethanol plant for T.P.K. Ethanol. Should be ready end 07, using cassava and
cassava chips. In March signed with Rajburi Ethanol and previously built part of
Thai Agro Energy’s plant.
Piya Chongvatana, Managing Director, Patkol
What is the correct scale of a biorefinery plant? Cost of transport and logistics.
Large scale vs. micro plants.
Case Study – Indonesia
The Indonesia government has dropped plans for large scale facilities and has
instead chosen to decentralise biodiesel production based on jatropha, in 54
micro plants spread across the country.
Effendi Sirait, Head of Biofuel Development, Ministry of Industry
Biodiesel Case Studies
Malaysia
Farm Energies International
Malaysian biodiesel producer, looking to list on AIM. Has a plant already, 3 more
being built.
Synergy Drive’s deal to merge three leading Malaysian plantation firms (Sime
Darby, Kumpulan Guthrie and Golden Hope) owned by Permodalan Nasional
(PNB) has gone through after snags. The merger would create the world’s
largest plantation company, accounting for 6% of global palm oil production in
turn having a major slice of the palm based biodiesel industry.
Ahmad Zubir Murshid, Group Chief Executive Officer, Sime Darby
Md Nor Yusuf, Chairman, Securities Commission.
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Energy major Royal Dutch Shell and US retail giant Proctor & Gamble are
venturing into biodiesel projects in Malaysia. State agency Federal Land
Development Authority Holdings (Felda) said it has formed a joint venture with
P&G to own and operate a biodiesel plant in early 07. Felda has been producing
methyl ester, an oleochemical product, as a diesel substitute since 1998.
Mohd Yusof, Chairman, Felda
Shell International will soon begin joint research with the Malaysia Palm Oil
Board to develop biodiesel for use in Malaysia.
Peter Chin, Plantation Industries and Commodities Minister
Vance Bioenergy
Zoop Sdn
Carotino biodiesel plants
Large asian palm oil player
Integrated palm biodiesel plant, one of the first
R&D
Commercialisation
U.R. Unnithan, Executive Director, Carotino
Malaysia/Indonesia
PT Indomal Usahasama a joint venture between Indonesian & Malaysian
investors said it will build a palm oil centre including oil palm plantations, crude
palm oil processing plants and palm oil based biodiesel plants. Planting begins
in February. Investing $1bln.
Chairul Anhar, President, Indomal
Indonesia
Companies building biodiesel plants, using palm oil
PT Bakrie Sumatra Plantations
PT Astra Agro Lestari
PT Asian Agri
State oil and gas company Pertamina is retailing biodiesel, made up of 5% crude
palm oil blended with 95% diesel oil.
Malaysia/Singapore
Peter Cremer (Nexsol Biodiesel)
German commodity trader Peter Cremer will start two Asian biodiesel plants in
July, but poor margins mean the plants may be run at less than half the capacity.
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At the same time as palm oil prices have risen far beyond expectations, crude
prices have fallen, making biodiesel too expensive to be compensated by tax
credits and other incentives. Problems compounded by the costs of exporting.
Focus on exporting to Japan, South Korea and Australia.
John Hall, Global Managing Director, Energy, Peter Cremer & Managing
Director, Nexsol Biodiesel
Singapore
Wilmar Energy, Singapore based biodiesel producer.
Philippines
Chemrez Technologies
Leading biodiesel producer in the Philippines, starting build of 3rd plant. Plans to
sell biodiesel to Japan in 2007 and hopes to enter the Malaysian market by 2008.
At present, selling to Europe, especially Germany.
Bio-Energy NL
Philippines biodiesel producer, investing in new facility and an integrated coconut
plantation. Japan Bank for International Cooperation is reportedly funding the
feasibility study. Biodiesel will be exported to Japan, from March B5 sales will be
allowed in Japan.
Bioenergy Corp
Consortium led by Philippines oil company Flying V will open its 30m litre a year
biodiesel facility in March. Bioenergy Corp is 50% owned by Enerfuse Holdings
(Flying V, Seaoil, Eastern, Unioil). The remaining 50% belongs to coconut
producers Golden Asian Oil, Mt. Holly Coco Industrial and other investors. The
output is mainly for the export market.
Fernando Martinez, Chairman & Chief Executive Officer, Eastern Petroleum
Australia
Natural Fuels
Australian biodiesel company, public share sale raised funds for construction of
plants in Singapore & Texas. 138m litre facility in Darwin is starting production
early 2007. Intending to float, strong management team (Chairman, John
Hewson). Babcock & Brown are the base funders of the plant. EU looking to
ban Palm Methyl Esters so production may need to be sold onshore, logistical
issues?
Australian Biodiesel Group
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A spin off of the Biodiesel Association of Australia. Have their own technology
that can run higher FFA feedstock’s, is it proven? Successfully listed, share price
fallen.
Australian Renewable Fuels (ARF)
Perth-based biodiesel producer is ramping up production volumes. 2 plants, one
in South Australia, one in Western Australia using Energea technology. 45m litre
plants, technology challenges of running low cost (tallow) feedstock’s.
Gull
Offering a biodiesel blend in Western Australia marketed under the banner of
‘Bio-D’. A well resourced company that have been in the downstream fuel
industry for some 30 years. Using ‘ecotech’ technology for the production of their
biodiesel, don’t believe they are offering B100 at the pumps yet.
China
China is some way behind where it wants to be in fuel ethanol. Questions need
to be answered in terms of energy balance, oxygenate versus octane enhancer
versus gasoline replacement. Water reuse and energy recovery needs to be
improved. Animal feed is seen as a waste product rather than a co-product.
China Clean Energy
New biodiesel factory in Fujian province. Production scheduled to start 2H 08.
Long term agreements with palm processors in Indonesia and Malaysia also
signed.
PetroChina
Planning a 200,000 tonnes per year biodiesel plant from forestry products.
Beidahuang Group
China’s largest agricultural investor is setting up a plant at Luzon in the
Philippines to produce ethanol from sugar and other crops.
China Biodiesel International Holding (CBI)
Construction of Longyan plant delayed, production should commence 1Q 07.
Construction also starting on third plant. New government policies developing
the market as well.
Jilin Fuel Ethanol Co
Several plants.
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India
Private firms are lining up millions of dollars of investments in India for biodiesel
production from the jatropha plant, with a new biofuels policy likely soon. Target
if replacing 5% of diesel with biodiesel from jatropha.
Sandeep Chaturvedi, President, Biodiesel Association of India
Cleancities Biodiesel India
Expect to start operations at a 250,000 tonne biodiesel project by July 07. The
plant will initially run on 80% imported feedstock, such as palm and cooking oil,
along with locally produced jatropha oil. Most of the jatropha plantations in India
are expected to start yielding oil for biodiesel production only after a few years.
Until this time, call for the India government to allow imports of non-edible oils at
rates of customs duty at par with the tariff on crude oil. Currently, an import duty
of 15-20% is levied on many non-edible oils along with a 16% countervailing
duty, while the import duty on crude oil is only 5%. The current domestic
biodiesel production capacity is between 25,000 and 50,000 tonnes. However by
the end of the year it may reach between 500,000 and 800,000 tonnes.
Srinivas Prasad Moturi, Chief Executive Officer, Cleancities
Thailand
Bangchak Petroleum
Thai refiner Bangchak Petroleum is to start a new 400,000 litres a day biodiesel
unit next year. Thai biodiesel consumption is expected to more than double to
100,000 litres a day by the end of this year, boosted by government tax breaks.
Also looking to expand its biodiesel retail outlets to 500 by year end from the
current 200. Currently using used cooking oil, looking to use domestic crude
palm oil (via agreements with plantation owners as no land of their own).
Bangkok does not currently impose taxes on biodiesel and subsidizes biofuels
via an oil fund which comes from the surcharges from domestic retail prices of
diesel and gasoline. Thailand has 3-4 biodiesel producer, Bangchak has 60%
market share.
Anusorn Sangnimnuan, President, Bangchak Petroleum
Uhde
Uhde to build first combined biodiesel (methyl ester) and fatty alcohol complex in
Thailand. Thai Oleochemicals Company and Thai Fatty Alcohols Company have
jointly commissioned Uhde to build a turnkey plant complex. Flexibility with
respect to feedstocks, oil-bearing plants, animal oils and fats and old vegetable
oils. Main feedstock will be palm oil. Operational from late 07.
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New Zealand
Biodiesel Oils NZ
New biodiesel plant is planned to be up and running by the end of 2007. About
120,000 tonnes of tallow a year are normally exported by the North Island and
the company hopes to purchase as much of that as possible. A second plant is
also envisaged in the South Island.
Tom McNicholl, Managing Director, Biodiesel Oils NZ
South Korea
ECO Solutions
South Korean biodiesel producer/investor. Also building a facility in Malaysia,
Global Bio-Diesel
Risks related to Biodiesel Business - The key risks related to biodiesel business
are:
Construction delays of the biodiesel plant
Financial overrun in the construction of the biodiesel plant
Change in Malaysian biodiesel import and export tax regulation
Change in pioneer status of corporate tax exemption in Malaysia
Change in Korean biodiesel related tax exemption regulation
Increase in competition
Disruptions of business due to natural disasters and other hazards
Sharp increase in feedstock prices from undersupply of palm oil due to adverse
weather conditions
Plummeting of crude oil prices lowering retail price of diesel in Korea
Currency risk related to Malaysian Ringgit and Korean Won
Biodiesel industry is relatively new without track record of operations
Delay in statutory approvals related to Phase II of the project
Loss of key executives
Technologies related to jatropha usage not being commercially viable
Transactions with related parties like Eco Enertech and Global Bio Oils
The terms of the notes limit financial and operational flexibility
John Park, Chief Executive Officer, ECO Solutions
Bioethanol Case Studies
India
Bajaj Hindusthan
Ethanol producer
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Shree Renuka Sugars
Completion of expansion works at its sugar plant in Munoli, crushing 7,500
tonnes of cane per year, 120,000 litres per day from the distillery. Offtake
agreements signed with Oil Marketing Companies in Goa for 3 years.
Uttam Sugar Mills
Large investment on diversification into fuel ethanol production and cogeneration
projects.
Dwarikesh Sugar Industries
Setting up 60,000 litres per day plant, operations starting May 2007.
Dollex
Sugar producer Dollex Ind announced that it would invest in a new ethanol plant
with a production capacity of 15m litres annually. Scheduled for commission in
the 07/08 sugar season, October – September. Godavari Sugar Mills, recently
acquired by Dollex, will supply the feedstock.
Simbhaoli Sugars, Rana Sugars to start up new ethanol plants
Two Indian sugar mills said they plan to expand ethanol production to help meet
the country’s growing demand for biofuels.
G.S.C. Rao, Executive Director, Simbhaoli Sugars
Ethanol Plants
XL Telecom
Shetimal Sahakari Prakriya Sanstha
Wallams Agro Products & Power
Patil Alco & Allied Industries
KMR Industries
Vamshi Exports
Precious Alco & Petro India
Russia/Kazakhstan
Biohim
Russian petrochemicals group Titan & Kazakh enterprise TOO Basko
Plans to build three more ethanol plants in Kazakhstan, processing locally grown
wheat. Already have plants in Kazakhstan & Russia.
Philippines
San Carlos Bio-Energy
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Bronzeoak Philippines & National Development Corporation
Integrated facility that will produce some 100,000 litres of bioethanol a day, also
a cane milling plant with a throughput capacity of 1,500 tonnes of cane daily, as
well as a co-generation power plant that will produce around 9 megawatts (MW)
of power, of which 4MW will be sold to the grid. Starting operations late 2007,
early 2008.
South Bukidnon Bioenergy (SBBI)
25m litre bioethanol plant scheduled to start production in 2H 07. Processing
sugarcane and molasses. Joint venture between Bronzeoak Philippines,
National Development Corporation and three group of local sugar planters.
Biofuels 88
An affiliate of the Flying V group, investing in ethanol production facilities in
various part of the country. Initial facility will have a production capacity of
60,000 litres a day.
Seaoil has also invested in a 100,000 litres per day ethanol plant.
Glenn Yu, President, Seaoil
Thailand
Thailand’s Ethanol Producers – In Production
Pornvilai International
Thai Agro Energy
Thai Alcohol Company
Thai Nguan Ethanol
Khon Kaen Alcohol Company
Petro Green
International Gasohol
Thailand’s Ethanol Producers – Under Construction
Fa Kwanthip
Ekarat Patana
Thai Sugar Ethanol
KI Ethanol
Ratchburi Ethanol
Thai Rung Ruang Energy
Petro Green
Confidential, please do not circulate beyond the intended recipient(s)
All speakers listed are ideas at this stage unless stated otherwise
Khon Kaen Sugar Industry (KSL)
Thailand, integrated sugar production and ethanol production. Uses some of its
own crop and sells the rest. Ethanol facility began operations at the start of
2006. Company now has to export its ethanol to Singapore, Japan and South
Korea due to the unclear government policy.
Chalush Chinthammit, Director, KSL
NIVL
Sugar producer NIVL has started production at its ethanol plant, using molasses
as the feedstock in the first stage. Planned for export to Australia, Japan, EU
and the ASEAN nations.
China
China Resources Alcohol Corporation (CRAC)
Intending to construct sufficient cellulosic ethanol facilities to generate 330m
gallons of ethanol by 2012. Canada’s SunOpta provided the initial systems and
technology. Production began in October 2006 from local corn stover. This
facility is reported to be the first cellulosic ethanol production facility operation in
China.
Guangxi Xintiande Energy
Capacity to produce up to 100,000 tonnes of food-grade ethanol from tapioca per
year. Exported about 60,000 tonnes of ethanol last year.
China National Petroleum
Reported to be conducting a feasibility study to build two cassava to ethanol
plants in Guangxi province. Each plant would have an annual capacity of
200,000 tonnes of fuel ethanol.
The state government of Tongliao, Inner Mongolia has reportedly signed an
agreement with Nengsheng Biotech to construct an ethanol facility. The plant will
also be able to produce 400,000 tonnes of feed a year as a by product.
Australia
Manildra, first onshore ethanol producer.
Biofuels Logistics/Downstream
o Importing
o Refineries
o Blending
Confidential, please do not circulate beyond the intended recipient(s)
All speakers listed are ideas at this stage unless stated otherwise
Japan is starting to import ETBE from France. Will be sold on a test basis in
retail gas stations in eastern Japan. Delivered to the Negishi refinery, operated
by Nippon Oil. In 2006 Japan decided to favour ETBE over ethanol. 7% blend.
Fumiaki Watari, Chairman, Nippon Oil & Petroleum Association of Japan
Philippines oil company Petron said it will invest PHP269m this year in logistics
for sales of ethanol blended gasoline. The company, in which the state holds a
40% stake is also in negotiations with Bronzeoak on the supply of anhydrous
ethanol. The company is also in talks with biodiesel producers for the use of
CME in blends.
The Indonesian Palm Oil Producers Association (Gapki) fears a new rule on the
use of tankers with double wall holds would raise the palm oil transportation
tariffs by 20%.
Derom Bangun, Executive Chairman, Gapki
Distribution, Wholesale & Retailing
Australian Farmers Fuel (SAFF)
Leaders in downstream and production of Biofuels in Australia, retail network
selling nearly only green fuels (some LPG, 10% methane). Carbon neutral fuel
as sequester daily sales of fuel equivalent through tree planting.
Andy Fischer, Managing Director, Australian Farmers Fuel (SAFF)
Caltex
Caltex said it had launched Australia’s first diesel fuel enhanced with 2%
biodiesel, marking the start of a major expansion of its supply of Biofuels. Part of
its strategy to meet the governments Biofuels Action Plan targets. Starting on
the East coast as several suppliers there.
Des King, Managing Director & Chief Executive Officer, Caltex
Mark Burrowes, Marketing General Manager, Caltex
BP Australia
Plans to deliver more than 400m litres of biofuels per year, exceeding the
government target. It is doubling the capacity of a new ethanol plant to be
constructed by Primary Energy in Western Australia. Has also signed MoUs with
other plants from Primary Energy and CSR. It has also signed a years contract
with Manildra.
Gerry Hueston, President, BP Australia
Automotive
Confidential, please do not circulate beyond the intended recipient(s)
All speakers listed are ideas at this stage unless stated otherwise
Enzyme Technology
How to ensure both lowest dose and most starch conversion.
Novozymes has a 50-60% share of the enzyme market with US biotech firm
Genencor which now belongs to Danisco after acquisition having a 30% share.
Novozymes saw strong growth in Asia last year.
Steen Riisgaard, President, Novozymes
Investment & Financing Options for Biofuels Projects
o Some projects are only profitable with subsidies – how will
these affect investments?
o Will the wave of investments continue
o Debt vs. equity
Indonesia
China National Offshore Oil Corporation, will invest $5.5bln in PT. Sinar Mas
Agro Resources and Technology (PT Smart) and Hong Kong Energy. Genting
Biofuel Asia will invest $3bln in PT. Pembangkit Jawa Bali and Energy and have
the support of local government to develop crude palm oil (CPO), sugarcane, and
jatropha plantations and biofuel production plants. PT Smart is a subsidiary of
Singapore’s Golden Agri-Resources.
India
Private companies are investing heavily in India for biodiesel production form
Jatropha. However this just scratches the surface of the investment needed over
the next five years to achieve its target of replacing 5% of diesel with biodiesel
from jatropha. Commercial sales would start in two to three years as it will take
that long for the jatropha plants to become oil bearing.
Sandeep Chaturverdi, President, Biodiesel Association of India
Thailand
Sea Horse
Frozen seafood producer Sea Horse announced plans to invest in an ethanol
production. The company plans to produce 1.5m litres of ethanol daily. Sea
Horse had earlier scrapped plans to take over Power Energy, a company which
owns a license to produce about 400,000 litres of ethanol a day.
Philippines
A total of 15 companies are currently planning to build bioethanol plants in the
Philippines, while five have applied to construct biodiesel plants, according to
Confidential, please do not circulate beyond the intended recipient(s)
All speakers listed are ideas at this stage unless stated otherwise
Representative Juan Miguel Zubiri, an initiator of the Biofuels Act. Bronzeoak
Philippines and the Teves Group. James Ledesma, Head, Sugar Regulatory
Association (SRA) had earlier said Japan’s Marubeni Corp, Toyota Tsushi Corp,
Japan Gas Corp, US-based American Far East Biofuels and India’s Dhampur
Sugar Mills had applied for bioethanol production licenses.
China
China National Offshore Oil Corporation has also signed an MoU with Bio Sweet
of Malaysia for a biodiesel plant in China
New Zealand
Argent Energy
Welcomed the discussion document on a proposed sales obligation for biofuels
by the New Zealand government. The company has been investigating
producing biodiesel from tallow (animal fats) in NZ for several months but no firm
decision has been made on the location and timing for the construction of a
biodiesel plant.
Dickon Posnett, UK Development Director & Managing Director, Argent Energy
New Zealand
The CDM and Biofuels
Next Generation Biofuels
o What technological developments will lead to economies of
scale and cost reductions
o Ligno-cellulosic ethanol and other Biofuels
o Utilising Biofuel and its bi-products for other uses of energy –
hydrogen production from Biofuels, Glycerol for hydrogen
production
o Making the biodiesel process more economically feasible
China
China’s largest oil producer PetroChina, plans to produce second generation
biofuels, made from starchy low input feedstocks such as woodchips or straw,
together with the State Forestry Administration. Hopes to have capacity to
produce over 2m tonnes of non-grain based ethanol a year.
Japan
BioEthanol Japan has started production at its cellulosic ethanol plant. It is
Japan’s first commercial facility. The Japanese Ministry of Environment
subsidized the construction.
Confidential, please do not circulate beyond the intended recipient(s)
All speakers listed are ideas at this stage unless stated otherwise
Cellulosic Biomass
The R&D unit of auto giant Honda and Japan’s Research Institute of Innovative
Technology for the Earth (RITE) said they have jointly developed technology that
produces ethanol from waste biomass such as leaves, discarded wood and other
non-edible plant materials.
Other Associations/Media/Research Institutes
Asian Institute of Petroleum Studies
3 different associations in Australia:
Renewable Fuels Australia, past funding by the first onshore ethanol producer
Biodiesel Association of Australia, small funding, run by the members of the
industry
Bioenergy Australia, progressive government funded group ran by Steve Schuck
Dato' Dr. Mohd. Basri Wahid, Director General, Malaysian Palm Oil Board,
Malaysia
Yang Xincheng, General Manager, China Energy Conservation Investment
Corporation (CECIC)
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